22/07/2021
Build, build, build — demand is high
The construction industry is experiencing a boom that looks set to continue through 2021, into 2022 and beyond. The Federation of Master Builders State of Trade Survey for Q1 2021 found that more than half of respondents reported higher workloads than Q4 2020, and that enquiries have increased at their fastest rate in more than a decade.
There’s no doubt about it, everyone’s busy and demand is high, which is great news for contractors, specifiers, suppliers and manufacturers alike. However, across the world, the sector as a whole is also feeling the impact of the reduced availability of certain raw materials that are essential to creating the products that the construction market relies upon. This isn’t just a problem that’s exclusive to the roofing industry, all suppliers have been affected in some way. We’re all in the same boat.
The reasons for these shortages are due to the global repercussions of the COVID-19 pandemic and the knock on effect of Brexit — the perfect storm for the industry. In addition to this the industry has been feeling the impact of:
- Plant closures, raw material manufactures unable to manufacture
- The Chinese market booming, resulting in privileged local demand
- Disruption caused by bad weather in US
- Suez Canal problems
- Rising oil prices
- Chemical raw material and commodity prices soaring and poor availability
- Road haulage surcharging
- Shortages of shipping containers and substantial cost increases and delays at shipping ports
These factors have seen construction costs rising at the fastest pace for 24 years, according to the latest Purchasing Managers’ Index.[1] There has been unprecedented price volatility across a wide range of critical raw materials, including steel, timber, polymers and materials used in polyurethane products,
which companies cannot continue absorbing.
The State of Trade Survey evidenced this, with 93 percent of respondents reporting material price increases. Add the fact that there are also delayed jobs that are now having to be accommodated and demand increases even further.
Our experience as a company has taught us to stock build to cover these complications and to accommodate a return to normal, however the entire industry is having to contend with a greater than expected rebound.
Sika’s global purchasing influence
Reassuringly, as a global company that specialises in the manufacture of a huge range of construction products and systems, including some of the raw materials that go into them, Sika has experienced procurement teams at both local and international levels. Our experts are working tirelessly to predict and respond to any issues concerning the current supply situation. By leveraging our advantageous purchasing influence we can help to mitigate any negative impacts for the contractors, specifiers and clients we work with. Our buying power means we will claim our fair share of those materials that are in short supply, giving you the advantage.
Please be assured that we’re working hard behind the scenes to react quickly and robustly to all situations that may have the potential to affect the manufacture and supply of our finished products. As such, we are pleased to report that thus far we have largely been able to ensure continuity of supply.
Looking to the future and working with you
As the global economy returns to normal, there is little doubt that the availability of raw materials will improve and that subsequent costs will stabilise. However, this will be largely dependent on how quickly this return to normality takes place as we emerge from a very challenging time for people and businesses all across the country. The reality of the situation is that we may not see stability — in real terms — until the end of this year or into next.
While we face uncertainty, Sika stands in solidarity with all its customers and partners and we will continue to work hard to ensure continuity of supply. We are sure you’ll agree that during this time it is more important than ever that we remain in close dialogue to ensure that everyone has the latest information and are fully aware of any developments in the supply situation.
With Sika’s wide portfolio of high performance roofing systems, including single ply membranes, liquid applied membranes and bituminous membranes from our leading brands — Sika Sarnafil, Sika Liquid Plastics, SikaBit and Sika-Trocal — we’re confident that we have the solution for your next project. We can advise on the most suitable roof type based on any functional and design requirements as well as the best options available in terms of logistics and delivery to meet your timeline. Providing us with as much notice of your project as possible is also helpful.
This is a fluid and rapidly changing situation. If we believe there are any possible areas of concern or potential impact to the supply of any project, we will endeavour to contact you immediately via your local Area Technical Manager. Likewise, if you have any concerns or wish to clarify anything, we would strongly encourage you to speak with your local Area Technical Manager.
[1] https://www.constructionnews.co.uk/data/data-news/costs-rise-at-fastest-pace-since-1997-as-demand-booms-07-05-2021/